A consumer can afford any combinations of two goods on or below the budget line.
Answer the following statement true (T) or false (F)
True
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Evidence in favor the Keynesian model would be that:
a. investment is not sensitive to changes in tax rates. b. labor supply is inelastic. c. the aggregate price level is positively correlated with income. d. all of the above. e. none of the above.
Critics of flexible exchange rates argue that flexible rates: a. reduce uncertainty in international trade
b. automatically create an equilibrium price for each currency in the foreign exchange market. c. make nations more constrained in carrying out internal macroeconomic policies. d. increase uncertainty in international trade.
It is impossible for the government to maintain a balanced budget while using fiscal policy to eliminate a recessionary gap.
Answer the following statement true (T) or false (F)
If in the economy, business saving equals $240 billion, household saving equals $15 billion and government saving equals -$150 billion, what is the value of national saving?
A. $415 billion B. $105 billion C. $265 billion D. $250 billion